7% Return Calculator
A 7% annual return is one of the most common long-term planning assumptions. Use this page to test what steady investing could look like over 10, 20, or 30 years.
Year-by-year breakdown
| Year | Ending balance | Total contributed | Total interest |
|---|
Why people search for 7%
Many investing articles use 7% as a rough long-run planning assumption after keeping expectations in check. It is useful for scenario planning, but it should still be tested against lower and higher return cases.
Best way to use this page
- Run the same contribution plan at 5%, 7%, and 8%.
- Look at the last ten years in the table to see how much late-stage compounding matters.
- Do not confuse a useful planning rate with a guaranteed market outcome.
Good next comparisons
What 7% looks like over different horizons
7% is the most commonly used long-run planning assumption for a diversified equity portfolio before inflation. It is a historical average, not a promise, and it is the default across this site for that reason. Every row uses this page's inputs — $10,000 to start and $300 a month — with 7% compounded monthly and contributions at the end of each month.
| After | You contributed | Balance | Interest earned |
|---|---|---|---|
| 5 years | $28,000 | $35,654 | $7,654 |
| 10 years | $46,000 | $72,022 | $26,022 |
| 15 years | $64,000 | $123,578 | $59,578 |
| 20 years | $82,000 | $196,665 | $114,665 |
| 25 years | $100,000 | $300,276 | $200,276 |
| 30 years | $118,000 | $447,156 | $329,156 |
Over the 20-year horizon this page defaults to, $82,000 of contributions becomes about $196,665. Extending to thirty years reaches $447,156 — the extra years are worth far more than the extra deposits that fund them.
How much the 7% assumption is actually carrying
The honest way to use a rate-specific calculator is to check what happens if the rate is wrong. Over 20 years, on the same contributions:
| Annual return | Final balance | vs 7% |
|---|---|---|
| 5% | $150,437 | -24% |
| 6% | $171,714 | -13% |
| 7% (7% — this page) | $196,665 | — |
| 8% | $225,974 | +15% |
| 9% | $260,458 | +32% |
Two points either side of 7% moves the 20-year result from about $150,437 to $260,458 — a spread of $110,021 on identical contributions. That spread is the uncertainty in the plan, and no calculator can narrow it. What you can do is decide which end of it your plan needs to survive.
- Fees come straight off the rate. A 1% annual charge on 7% behaves like 6%, costing about $24,951 over 20 years here.
- Inflation is not deducted. At 2.5%, $196,665 in 20 years buys about what $120,019 buys today.
- A constant rate is a modelling device. Real returns arrive out of order, and the order matters once you start withdrawing.
Questions about 7% returns
How much does $10,000 grow at 7%?
On its own, with no contributions, $10,000 at 7% compounded monthly reaches about $40,387 in 20 years. Adding $300 a month takes it to roughly $196,665.
How long does money take to double at 7%?
About 10.0 years with monthly compounding. The Rule of 72 estimates 72 ÷ 7 = 10.3 years, which is close enough to do in your head.
Is 7% a realistic assumption?
7% is the most commonly used long-run planning assumption for a diversified equity portfolio before inflation. It is a historical average, not a promise, and it is the default across this site for that reason. Whatever rate you choose, run the plan at one or two points lower as well — if it only works at the optimistic figure, it is not yet a plan.